Correlation Between Victory Supermarket and Bezeq Israeli

Can any of the company-specific risk be diversified away by investing in both Victory Supermarket and Bezeq Israeli at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Victory Supermarket and Bezeq Israeli into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Victory Supermarket Chain and Bezeq Israeli Telecommunication, you can compare the effects of market volatilities on Victory Supermarket and Bezeq Israeli and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Victory Supermarket with a short position of Bezeq Israeli. Check out your portfolio center. Please also check ongoing floating volatility patterns of Victory Supermarket and Bezeq Israeli.

Diversification Opportunities for Victory Supermarket and Bezeq Israeli

0.85

Correlation Coefficient

Victory Supermarket  Bezeq Israeli

Very poor diversification

The 3 months correlation between Victory and Bezeq is 0.85. Overlapping area represents the amount of risk that can be diversified away by holding Victory Supermarket Chain and Bezeq Israeli Telecommunicatio in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Bezeq Israeli Teleco and Victory Supermarket is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Victory Supermarket Chain are associated (or correlated) with Bezeq Israeli. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Bezeq Israeli Teleco has no effect on the direction of Victory Supermarket i.e., Victory Supermarket and Bezeq Israeli go up and down completely randomly.

Pair Corralation between Victory Supermarket and Bezeq Israeli

Assuming the 90 days trading horizon Victory Supermarket is expected to generate 1.23 times less return on investment than Bezeq Israeli. In addition to that, Victory Supermarket is 1.41 times more volatile than Bezeq Israeli Telecommunication. It trades about 0.11 of its total potential returns per unit of risk. Bezeq Israeli Telecommunication is currently generating about 0.19 per unit of volatility. If you would invest  54,910  in Bezeq Israeli Telecommunication on May 7, 2025 and sell it today you would earn a total of  8,320  from holding Bezeq Israeli Telecommunication or generate 15.15% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Together
Strength	Strong
Accuracy	100.0%
Values	Daily Returns

Victory Supermarket Chain  vs.  Bezeq Israeli Telecommunicatio

Victory Supermarket Chain

Risk-Adjusted Performance

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Victory Supermarket Chain are ranked lower than 8 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Victory Supermarket sustained solid returns over the last few months and may actually be approaching a breakup point.

Bezeq Israeli Teleco

Risk-Adjusted Performance

Good

Compared to the overall equity markets, risk-adjusted returns on investments in Bezeq Israeli Telecommunication are ranked lower than 14 (%) of all global equities and portfolios over the last 90 days. Despite somewhat weak basic indicators, Bezeq Israeli sustained solid returns over the last few months and may actually be approaching a breakup point.

Pair Trading with Victory Supermarket and Bezeq Israeli

The main advantage of trading using opposite Victory Supermarket and Bezeq Israeli positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Victory Supermarket position performs unexpectedly, Bezeq Israeli can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Bezeq Israeli will offset losses from the drop in Bezeq Israeli's long position.

The idea behind Victory Supermarket Chain and Bezeq Israeli Telecommunication pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

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Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Stocks Directory module to find actively traded stocks across global markets.